A-96967, AUGUST 8, 1938, 18 COMP. GEN. 142

A-96967: Aug 8, 1938

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CONTRACTS - MISTAKES - BIDS - ALLEGATION AFTER OPENING OF BIDS INVOLVING A CORRECTION APPROXIMATING NEXT LOWEST BID WHERE A MISTAKE IN BID CONSISTING OF THE FAILURE TO INCLUDE A SUBCONTRACTOR'S ITEM WAS NOT ALLEGED BY THE REPRESENTATIVE OF THE BIDDER PRESENT AT THE OPENING UNTIL AFTER ALL BIDS WERE OPENED. IS STATED NOT TO HAVE BEEN COMMUNICATED TO THE REPRESENTATIVE PRIOR THERETO BECAUSE OF INABILITY IN LOCATING HIM. IT IS EVIDENT FROM THE BIDDER'S WORK SHEETS THAT THE ITEM WAS NOT INCLUDED BUT THERE IS REASONABLE PROBABILITY THAT HAD IT BEEN INCLUDED. TOGETHER WITH THE ADDITIONAL AMOUNT WHICH WOULD HAVE BEEN ADDED FOR PROFIT. THE BID WOULD NOT THEN HAVE BEEN THE LOWEST RECEIVED. AS FOLLOWS: TRANSMITTED HEREWITH FOR YOUR DETERMINATION IS THE REQUEST OF THE DEPEW PAVING CO.

A-96967, AUGUST 8, 1938, 18 COMP. GEN. 142

CONTRACTS - MISTAKES - BIDS - ALLEGATION AFTER OPENING OF BIDS INVOLVING A CORRECTION APPROXIMATING NEXT LOWEST BID WHERE A MISTAKE IN BID CONSISTING OF THE FAILURE TO INCLUDE A SUBCONTRACTOR'S ITEM WAS NOT ALLEGED BY THE REPRESENTATIVE OF THE BIDDER PRESENT AT THE OPENING UNTIL AFTER ALL BIDS WERE OPENED, AND, ALTHOUGH KNOWN TO THE BIDDER PRIOR TO THE OPENING, IS STATED NOT TO HAVE BEEN COMMUNICATED TO THE REPRESENTATIVE PRIOR THERETO BECAUSE OF INABILITY IN LOCATING HIM, AND IT IS EVIDENT FROM THE BIDDER'S WORK SHEETS THAT THE ITEM WAS NOT INCLUDED BUT THERE IS REASONABLE PROBABILITY THAT HAD IT BEEN INCLUDED, TOGETHER WITH THE ADDITIONAL AMOUNT WHICH WOULD HAVE BEEN ADDED FOR PROFIT, BOND, ETC., THE BID WOULD NOT THEN HAVE BEEN THE LOWEST RECEIVED, THE BID MAY NOT BE CORRECTED, BUT SHOULD BE DISREGARDED IN MAKING THE AWARD.

ACTING COMPTROLLER GENERAL ELLIOTT TO THE SECRETARY OF WAR, AUGUST 8, 1938:

THERE HAS BEEN RECEIVED YOUR LETTER OF AUGUST 3, 1938, AS FOLLOWS:

TRANSMITTED HEREWITH FOR YOUR DETERMINATION IS THE REQUEST OF THE DEPEW PAVING CO., INC., DEPEW, NEW YORK, FOR THE WITHDRAWAL OR AMENDMENT OF ITS BID FOR THE RESTORATION AND COMPLETION OF BARRACKS BUILDING NO. 50'S AT FT. NIAGARA, N.Y. ALL RELATED DOCUMENTS NECESSARY FOR THE CONSIDERATION OF THIS CASE ARE INCLOSED.

THE CONSTRUCTING QUARTERMASTER AT FT. NIAGARA, N.Y., ADVERTISED FOR BIDS FOR THE RESTORATION AND COMPLETION OF BARRACKS BUILDING NO. 50-S. IN RESPONSE TO THIS INVITATION SEVEN BIDS IN PROPER FORM WERE RECEIVED. ALL BIDS WERE OPENED BY THE CONSTRUCTING QUARTERMASTER, FT. NIAGARA, N.Y., AT 10 A.M. EASTERN STANDARD TIME, JULY 21, 1938. AN ABSTRACT OF ALL BIDS RECEIVED, A COPY OF WHICH IS INCLOSED, SHOWS THAT THE BID OF THE DEPEW PAVING COMPANY, INC., IN THE AMOUNT OF $55,974.25 FOR ITEM 1 WAS THE LOWEST BID RECEIVED BY $9,920.75.

THE FACTS OF THIS CASE AS ESTABLISHED BY THE RECORD ARE AS FOLLOWS:

(A) THIS DEPARTMENT RECEIVED A LETTER DATED JULY 21, 1938, OVER THE SIGNATURE OF MR. EMIL CERULLO AS TREASURER OF THE DEPEW PAVING CO., INC., REQUESTING THAT HIS COMPANY BE PERMITTED TO WITHDRAW ITS BID OR AMEND THE SAME BY ADDITION IN THE AMOUNT OF $8,885.00. A COPY OF THIS LETTER IS INCLOSED FOR YOUR REFERENCE.

IN SUPPORT OF THE ALLEGATIONS CONTAINED IN MR. CERULLO'S LETTER THERE HAVE BEEN SUBMITTED A LETTER FROM BATT CO., INC., THE SUBCONTRACTOR WHO PROPOSED TO INSTALL THE PLUMBING AND HEATING EQUIPMENT, A COPY OF WHICH IS INCLOSED, AND THE ORIGINAL WORK SHEET USED BY THE DEPEW PAVING CO., INC., IN COMPUTING ITS BID. THIS ORIGINAL WORK SHEET BEARS AN AFFIDAVIT BY MR. CERULLO TO THE EFFECT THAT THE ITEM FOR HEATING AND PLUMBING WAS NOT INCLUDED IN THE TABULATION OF THE BID SUBMITTED.

(B) THE DEPEW PAVING CO., INC., CLAIMS THAT THE ALLEGED MISTAKE WAS NOT DISCOVERED UNTIL MR. EUGENE JANUALE HAD LEFT DEPEW FOR FT. NIAGARA WITH THE BID, AND THAT EVERY EFFORT WAS MADE TO CONTACT HIM IN ORDER THAT HE COULD CHANGE OR WITHDRAW THE BID THAT HAD BEEN PREPARED BUT THAT THE DEPEW PAVING CO., INC., WAS UNABLE TO REACH MR. JANUALE UNTIL AFTER ALL THE BIDS WERE OPENED. THE RECORD FAILS TO SHOW THAT THE DEPEW PAVING CO., INC., ATTEMPTED TO AMEND OR WITHDRAW ITS BID BY TELEGRAPH, ALTHOUGH IT APPEARS THAT THERE WAS AMPLE TIME FOR THE BIDDER TO HAVE DONE THIS, OR TO HAVE TAKEN OTHER PRECAUTIONARY MEASURES.

(C) THE CONSTRUCTING QUARTERMASTER AT FT. NIAGARA STATES THAT IMMEDIATELY UPON COMPLETION OF THE OPENING OF ALL BIDS A REPRESENTATIVE OF THE DEPEW PAVING CO., INC., MR. JANUALE, REQUESTED THAT ITS BID BE WITHDRAWN, STATING THAT A SERIOUS MISTAKE HAD BEEN MADE IN THE FIGURES SUBMITTED. COPY OF THE LETTER OF THE CONSTRUCTING QUARTERMASTER, GIVING A COMPLETE REPORT OF THE OPENING OF THESE BIDS, IS INCLOSED FOR YOUR CONVENIENCE.

(D) AN ANALYSIS OF THE FIGURES CONTAINED IN THE ABSTRACT OF BIDS DISCLOSES THAT THE BID OF THE DEPEW PAVING CO., INC., IS APPROXIMATELY 85 PERCENT OF THE SECOND AND THIRD LOW BIDS AND APPROXIMATELY 82 PERCENT OF THE AVERAGE OF ALL BIDS RECEIVED. A COMPARISON OF ALL BIDS FAILS TO INDICATE A DISPARITY IN THIS BID SUCH AS WOULD ORDINARILY PUT THE CONTRACTING OFFICER ON NOTICE THAT AN OBVIOUS MISTAKE HAD BEEN MADE IN THE PREPARATION OF ANY OF THE BIDS SUBMITTED.

DUE TO THE EXTREME NEED FOR THIS FACILITY, WHICH WAS PARTIALLY DESTROYED BY FIRE, AND INASMUCH AS AUTHORIZATION OF THE AWARD OF THIS CONTRACT FOR RESTORATION IS BEING HELD IN ABEYANCE PENDING YOUR DETERMINATION, PROMPT CONSIDERATION HEREOF WILL BE APPRECIATED.

SEVEN BIDS WERE RECEIVED, AS FOLLOWS:

CHART DEPEW PAVING CO., INC., 80 MAIN ST., DEPEW, N.Y ----------- $55,974.25 WRIGHT AND KREMERS, INC., PINE AND MAIN STS.,

NIAGARA FALLS, N.Y ---------------------------------------- 65,895.00 J. P. SNYDER CONSTRUCTION CO., INC., 229 LOVERING

AVE., BUFFALO, N.Y --------------------------------------- 66,000.00 WALTER S. JOHNSON BUILDING CO., INC., HYDE PARK

BLVD., NIAGARA FALLS, N.Y -------------------------------- 67,800.00 SCRUFARI CONSTRUCTION ., 825 15TH ST., NIAGARA FALLS,

N.Y ------------------------------------------------------- 69,552.00 C. C. BREMER AND CO., 2576 SENECA AVE., NIAGARA FALLS,

N.Y ------------------------------------------------------- 71,787.00 LAUR AND MACK CONTRACTING CO., INC., BOX 563, NIAGARA

FALLS, N.Y ------------------------------------------------ 79,925.00

IN A LETTER DATED JULY 21, 1938--- THE DAY THE BIDS WERE OPENED--- THE CONSTRUCTING QUARTERMASTER REPORTED THAT A REPRESENTATIVE OF THE LOW BIDDER, DEPEW PAVING CO., INC., WAS PRESENT AT THE OPENING OF THE BIDS AND THAT UPON COMPLETION OF THE OPENING OF THE BIDS THE SAID REPRESENTATIVE REQUESTED TO BE ALLOWED TO WITHDRAW THE BID OF HIS COMPANY, STATING THAT A SERIOUS MISTAKE HAD BEEN MADE IN THE FIGURES SUBMITTED. THIS ALLEGATION OF MISTAKE WAS VERIFIED BY A LETTER FROM THE BIDDER DATED JULY 21, 1938, AS FOLLOWS:

IN OUR ANXIETY AND HURRY IN PREPARING OUR BID FOR ERECTING BARRACK BUILDING, NO. 50-S, AT FORT NIAGARA TO BE OPENED TODAY WE FAILED TO INCLUDE THE ITEM OF HEATING AND PLUMBING WHICH AMOUNTED TO $8,885.00.

THIS OMISSION WAS NOT DISCOVERED BY THE UNDERSIGNED UNTIL MR. EUGENE JANUALE, VICE PRESIDENT OF OUR CORPORATION, HAD LEFT DEPEW FOR FORT NIAGARA WITH OUR BID. ALTHOUGH WE MADE VERY EFFORT TO CONTACT HIM SO THAT HE COULD CHANGE OUR BID OR WITHDRAW SAME, WE WERE UNABLE TO DO SO BEFORE THE BIDS WERE OPENED.

ACCORDINGLY WE ARE HEREWITH ATTACHING COPY OF OUR MAKE-UP SHEET TOGETHER WITH BID FROM SUBCONTRACTOR FOR HEATING AND PLUMBING, WHICH BID WE FAILED TO INCLUDE IN OUR CONTRACT PRICE.

WE THEREFORE ASK THAT YOU ALLOW US TO WITHDRAW OUR BID OR ADD TO OUR CONTRACT PRICE THE ITEM OF $8,885.00, WHICH WAS OMITTED IN OUR BID.

IN SUPPORT OF THE ALLEGED ERROR, THE SAID BIDDER HAS FURNISHED ITS ORIGINAL ESTIMATE SHEETS, DULY ATTESTED, SHOWING THE VARIOUS ITEMS INCLUDED IN THE TOTAL OF $55,974.25 AND CONTAINING NO ITEM FOR THE HEATING AND PLUMBING. ALSO, THERE HAS BEEN FURNISHED THE ORIGINAL OF A LETTER DATED JULY 20, 1938, FROM THE BATT CO., INC., TO THE DEPEW PAVING CO., INC., AS FOLLOWS:

WE PROPOSE TO INSTALL THE PLUMBING AND HEATING WORK IN THE FORT NIAGARA BARRACKS, ACCORDING TO PLANS AND SPECIFICATIONS, FOR THE SUM OF EIGHT THOUSAND EIGHT HUNDRED EIGHTY-FIVE ($8,885.00) DOLLARS.

THE EVIDENCE SUBMITTED MAY BE ACCEPTED AS ESTABLISHING THAT THE ITEM OF HEATING AND PLUMBING WAS OMITTED FROM THE TOTAL PRICE OF $55,974.25. HOWEVER, IT IS TO BE PRESUMED THAT IF THE ITEM OF $8,885 HAD BEEN ADDED TO THE CONSTRUCTION COST THERE WOULD HAVE BEEN ADDED, ALSO, AN ADDITIONAL AMOUNT FOR PROFIT, BOND, ETC. HENCE, IT IS NOT SHOWN BEYOND A REASONABLE DOUBT THAT BUT FOR THE MISTAKE THE DEPEW PAVING CO., INC., WOULD HAVE BEEN THE LOWEST BIDDER. ACCORDINGLY, SAID BID SHOULD BE DISREGARDED IN MAKING THE AWARD. SEE IN THIS CONNECTION 17 COMP. GEN. 416.